In the

United States Court of Appeals

For the Seventh Circuit

No. 09-3375

BOARD OF TRUSTEES OF THE UNIVERSITY OF ILLINOIS,

Plaintiff-Appellee,

v.

ORGANON TEKNIKA CORPORATION LLC,

Defendant-Appellant.

Appeal from the United States District Court

for the Northern District of Illinois, Eastern Division.

No. 09 C 4251—Ronald A. Guzmán, Judge.

ARGUED APRIL 1, 2010—DECIDED JULY 27, 2010

Before EASTERBROOK, Chief Judge, and BAUER and

HAMILTON, Circuit Judges.

EASTERBROOK, Chief Judge. Organon Teknika, a subsidiary of the pharmaceutical manufacturer Merck & Co.,

licenses from the University of Illinois some intellectualproperty rights needed to make Tice BCG, a drug for ®

cancer. The royalty that the University receives depends

on what Organon Teknika collects from its customers.
2 No. 09-3375

Because the license allows Organon Teknika to sell to

affiliated firms, the University was concerned that the

transfer prices would be too low and depress its royalty

revenue. The license permits the University to reopen the

royalty rate if it believes that Organon Teknika’s intracorporate-family prices are lower than the price it charges

(or would charge) after arms’-length negotiations with

unrelated buyers. The contract provides that an arbitrator

will look at comparable pharmaceutical transactions to

determine whether Organon Teknika is charging arms’-

length prices.

In 2006 the University exercised its option to arbitrate

the pricing question. The parties selected as their

arbitrator William Albrecht, III, a consultant with CONSOR

Intellectual Asset Management. Albrecht received evidence

about 39 supposedly comparable selling arrangements.

The University denied that any of the 39 was the sort of

comparable arms’-length deal that the license contemplated. Albrecht eventually concluded that four particular

transactions serve as benchmarks, that they had been

negotiated at arms’ length, and that they establish that

the University is continuing to receive the return for

which it negotiated. Albrecht entered an award that

closed the proceeding without changing the royalty rate.

The report was accompanied by a cover letter that described the award as “final”; CONSOR sent a “final” bill for

its services. (The award itself was withheld until the

bill had been paid.)

The University was not satisfied with this defeat, but

it did not seek judicial review of the award or ask Albrecht
No. 09-3375 3

to modify it within the 90 days allowed by 9 U.S.C. §12.

Six months after the bills had been paid and the award

released to the parties, the University asked Albrecht

to reconsider, contending that two of the four transactions he selected as comparable had not actually been

negotiated at arms’ length. It relied on these two sentences from Albrecht’s opinion:

The foregoing opinions and conclusions contained

in this report are based upon the documents,

information, and research undertaken as of the

date of this report. I reserve the right to revisit

my analysis and amend my conclusions, should

additional information become available for review.

CONSOR asked its lawyers whether it was legally permitted

to reopen the arbitration; counsel said yes, but that it

should not do so unless the parties agreed. CONSOR relayed this conditional willingness (adding, as an additional condition, the parties’ undertaking to pay for

the extra work). The University promptly consented;

Organon Teknika did not.

Frustrated by this lack of cooperation, the University

filed this suit and asked the district court to compel

Organon Teknika to resume the arbitration. It describes

its claim for relief as a demand that Organon Teknika

honor its commitment to arbitrate any dispute about

reopening the royalty rate. Organon Teknika replied that

it did honor its obligation, that the arbitration was completed, that the University lost, and that the time for

further review has expired.
4 No. 09-3375

Instead of resolving the parties’ dispute, the district

court held that there was no dispute to resolve. The

district judge wrote a brief order dismissing the suit on

the ground that Albrecht had not made a final award, so

the matter remained before him and there was nothing

for a court to do. Both sides were stunned by this disposition, which neither had suggested.

Surprisingly, Organon Teknika has appealed. Its appeal is surprising because it is the apparent victor. The

University commenced this litigation in quest of an order

requiring Organon Teknika to resume the arbitration; it

emerged empty-handed. Organon Teknika asked the

district court to deny the University’s request. The judge

obliged—and though the judge’s reason differs from

Organon Teknika’s, a victory for the “wrong” reason is

still a victory. Yet the University, which lost, did not

appeal; and Organon Teknika, which won, did. What’s

going on?

We asked that question at oral argument. Organon

Teknika’s lawyer says that it appealed because it

disagrees with the district judge’s reason for entering a

judgment in its favor. It believes that the reason may

come back to haunt it if, in the future, the University

files another suit and insists that Organon Teknika is

liable for abandoning the arbitration before its completion. Yet litigants can’t appeal from district judges’ opinions; only their judgments are subject to appellate review.

California v. Rooney, 483 U.S. 307, 311–14 (1987); In re UAL

Corp., 468 F.3d 444, 449 (7th Cir. 2006); United States v.

Accra Pac, Inc., 173 F.3d 630, 632 (7th Cir. 1999).
No. 09-3375 5

We called for post-argument briefs about appellate

jurisdiction. It is apparent from these briefs, and from

some further thought about the subject, that Organon

Teknika’s root concern deals with the terms of the judgment rather than the language of the opinion. What

Organon Teknika wanted from this litigation (given that

it had to endure suit in the first place) was an order

dismissing the University’s claim with prejudice, so that

the controversy about the royalty rate would be over.

(At least until the University’s next opportunity to

exercise the reopener clause.) It didn’t get that. The

University’s suit has been dismissed without resolution,

and thus without prejudice to renewal whenever the

University deems the time ripe to complain about

Organon Teknika’s continuing refusal to submit evidence and arguments to arbitrator Albrecht. Perhaps the

University thinks that, armed with the district judge’s

decision, it can persuade Albrecht to revise his award

without Organon Teknika’s participation. No matter. It

is enough to say that Organon Teknika is aggrieved by

the terms of the judgment as well as the language of the

opinion and therefore is entitled to appellate review. See,

e.g., Schering-Plough Healthcare Products, Inc. v. Schwarz

Pharma, Inc., 586 F.3d 500, 506 (7th Cir. 2009) (collecting

cases).

The merits of the appeal will not long detain us. The

district court plainly erred in thinking that Albrecht’s

award was not final. It resolves the parties’ dispute; it

was accompanied by a cover letter calling it the final

decision; the parties paid their final bills. Nothing

further happened for six months—and neither side sug-
6 No. 09-3375

gested to the other that something should have been

happening to get the proceeding wrapped up. It had been

wrapped up already. See Olson v. Wexford Clearing

Services Corp., 397 F.3d 488, 491 (7th Cir. 2005); McKinney

Restoration Co. v. Bricklayers Union, 392 F.3d 867, 872

(7th Cir. 2004).

The language to which the district court pointed is

the arbitral equivalent of Fed. R. Civ. P. 60(b)(2), which

allows a judgment to be reopened to consider “newly

discovered evidence that, with reasonable diligence,

could not have been discovered in time to move for a

new trial under Rule 59(b)”. No one thinks that the possibility of reopening a district court’s judgment under

Rule 60(b)(2) six months after its entry makes the judgment non-final and hence precludes an appeal. See Fed. R.

Civ. P. 60(c)(2). Likewise no one should think that the

equivalent language in an arbitrator’s opinion makes the

decision non-final. See Glass Molders Union v. Excelsior

Foundry Co., 56 F.3d 844 (7th Cir. 1995). The parties have

regaled us with discussions of the “functus officio doctrine” and other technicalities of arbitral law, but none

of them matters. The situation is as simple and straightforward as we have described it.

Organon Teknika is entitled to a decision, on the merits,

in its favor. Rule 60(c)(1) gives the parties one year to

present newly discovered evidence in support of a

motion under Rule 60(b)(2). Arbitrator Albrecht did not

tell the parties how long they had to use the opportunity

he contemplated, but the Federal Arbitration Act does:

90 days. 9 U.S.C. §12. The parties did not supersede
No. 09-3375 7

that rule by contract. They bargained for a final and

conclusive decision, not for perpetual arbitration. So

the University’s request came too late. This arbitration

is over.

The judgment is vacated, and the case is remanded

with instructions to enter a judgment dismissing the

suit with prejudice.

7-27-10